It was another negative finish in the City today, as investors engaged in a round of profit taking amid the ongoing crisis in Ukraine, a disappointing result from Melrose and a number of stocks going ex-dividend.

Acting as a backdrop, there was negative market-chatter to be heard surrounding the potential risks from what may soon turn into China´s first default of an onshore bond and analysts modestly lowering their forecasts for Friday´s non-farm payrolls report Stateside.

To take note of as well, overnight, at China´s National People´s Congress, authorities in that country seemed to leave themselves some room for manouvre should gross domestic product not meet this year´s target for growth of 7.5%.

The FTSE 100 closed 48.35 points lower at 6,775.42.

Meanwhile, tensions still remain high about the situation in Ukraine given the Western condemnation of recent actions by Moscow to step up its military presence in the Crimea region.

"We have not been short of countries condemning the position of Russia but no one has gone as far as to actually react with any meaningful talk of sanctions against Russia. However, sanctions could cause huge issues for not only Russia but for the rest of Europe and the world," said James Hughes, Chief Market Analyst at Alpari UK.

UK February services PMI reveals capacity under pressure

A reading on levels of activity in the UK service sector slipped in February but was nevertheless indicative of a sharp pace of growth, while confidence in the outlook strengthened to its highest in four-and-half years.

The Markit service sector purchasing managers´ index (PMI) fell to 58.2 from 58.3 in the month before. It was the slowest pace on record since June, but nevertheless came in ahead of the 58 points expected.

In other macro news, UK shop prices dropped for a 10th consecutive month in February, declining by 1.4% after a fall of 1% in January, according to the British Retail Consortium (BRC). This is the deepest level of deflation since December 2006, when the business group began recording data.

Friday´s US non-farm payrolls report may be modestly weaker than expected

The US ISM non-manufacturing purchasing managers' index dropped to a reading of 51.6 in February from 54 in the month before, its lowest level since February 2010. The main drag came from a steep fall in the employment gauge, which slid to 47.5 from 56.4.

"The uneven moves in the sub-indices suggest that weather was not the only cause of the headline decline," Barclays Research commented following the report.

Admiral climbs on profit jump, Melrose slumps

Investors cheered an in-line set of full-year results from insurance giant Admiral, as the group increased profits by 7%, despite revenues falling 8%.

Randgold Resources rose after Nomura raised its target price from 4,600p to 6,000p and upgraded the stock to 'buy'.

Meanwhile, industrial conglomerate Melrose saw profits almost double in 2013, but shares dropped sharply after the company said that sales growth in 2014 remained "challenging". Both Numis and Investec downgraded their ratings on the stock this morning.

Meggitt was a big faller after Deutsche Bank cut its target price on the stock from 510p to 485p.

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